MOROCCO Law and Practice Contributed by: Loris Marghieri, Dounia El Aissaoui and Julien Nouchi, Gide Loyrette Nouel
includes – in addition to the amount secured in the principal – the expected expenses (or 6% of the principal if no estimation is made) and the interest (capped at the value of the interest paid over two years). The amount of the taxable basis thus determined is subject to registration duties at a rate of 1.5% and is payable within 30 days following execution. • Land Registry fees, which depend on the value of the mortgage, as follows: (a) lower than MAD250,000 – 0.5%; (b) between MAD250,000 and MAD5 million – 1.5%; and (c) above MAD5 million – 0.5%. A fixed duty (per property) of MAD100 also applies. No stamp duties apply to credit or security agreements (subject to exceptions). The enforcement of a security requires no spe - cific fee. 3.5 Legal Requirements Before an Entity Can Give Valid Security In addition to corporate authorisations, a Moroc - can entity must ensure that the following rules are complied with when granting any security. • Financial assistance ( assistance financière ) rule: pursuant to Article 280 of Law No 17-95 relating to joint stock companies, providing financial assistance to the target company in the form of advances of funds, loans or security with a view to the subscription or purchase of its own shares by a third party is prohibited. Article 280 refers to financial assistance “in view of” the acquisition/sub - scription (ie, at the time of the transaction or in contemplation of a transaction). In theory, the provisions prohibiting financial assistance
under Law No 17-95 do not apply to limited liability companies, and Law No 5-96 on limited liability companies does not set out similar provisions. • Corporate benefit ( intérêt social ) rule: any decision for a company must be taken in its best interest. The existence of a corporate benefit is ultimately a business decision and, as such, is a decision for the company’s directors to make. Any assessment of wheth - er there is a benefit to the company must be made on a case-by-case basis. • Corporate purpose ( objet social ) rule: any security granted by a Moroccan entity for the benefit of third parties must comply with the corporate purpose of the entity. Moroc - can law does not provide any definition of corporate purpose, but both Law No 17-95 and Law No 5-96 provide that the corporate purpose must be specified in the articles of association. In addition, the creation of movable and immov - able securities will require (as the case may be) the completion of registration formalities with the National Register of Securities over movable assets ( registre national électronique des sûretés mobilières ) or with the competent Land Registry. 3.6 Formalities When a Borrower Is in Default The secured lenders should have no difficulties collecting on a mortgage as long as the following criteria are met: • the mortgage is duly registered in the local Land Registry; • it is a first-ranking mortgage; and • the borrower is not undergoing insolvency proceedings.
657 CHAMBERS.COM
Powered by FlippingBook